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<div class=Section1>
<p class=MsoNormal><font size=2 color=navy face=Arial><span style='font-size:
10.0pt;font-family:Arial;color:navy'>What you have not mentioned whether the
complaint had any merit and whether the Parties could not have resolved it
between themselves rather than relying on the CCK to mediate every commercial
dispute. There is much more to this than just the one-sided view quoted by the
media but we have chosen not to try to resolve our disputes through the media.<o:p></o:p></span></font></p>
<p class=MsoNormal><font size=2 color=navy face=Arial><span style='font-size:
10.0pt;font-family:Arial;color:navy'><o:p> </o:p></span></font></p>
<p class=MsoNormal><font size=2 color=navy face=Arial><span style='font-size:
10.0pt;font-family:Arial;color:navy'>Regards<o:p></o:p></span></font></p>
<p class=MsoNormal><font size=2 color=navy face=Arial><span style='font-size:
10.0pt;font-family:Arial;color:navy'><o:p> </o:p></span></font></p>
<div>
<p class=MsoNormal><font size=2 color=navy face="Times New Roman"><span
style='font-size:10.0pt;color:navy'>Michael<o:p></o:p></span></font></p>
<p class=MsoNormal><font size=3 color=navy face="Times New Roman"><span
style='font-size:12.0pt;color:navy'><o:p> </o:p></span></font></p>
<p class=MsoNormal><i><font size=2 color=navy face="Times New Roman"><span
style='font-size:10.0pt;color:navy;font-style:italic'>CEO<o:p></o:p></span></font></i></p>
<p class=MsoNormal><i><font size=2 color=navy face="Times New Roman"><span
style='font-size:10.0pt;color:navy;font-style:italic'>Safaricom Limited</span></font></i><font
color=navy><span style='color:navy'><o:p></o:p></span></font></p>
</div>
<p class=MsoNormal><font size=2 color=navy face=Arial><span style='font-size:
10.0pt;font-family:Arial;color:navy'><o:p> </o:p></span></font></p>
<div>
<div class=MsoNormal align=center style='text-align:center'><font size=3
face="Times New Roman"><span style='font-size:12.0pt'>
<hr size=2 width="100%" align=center tabindex=-1>
</span></font></div>
<p class=MsoNormal><b><font size=2 face=Tahoma><span style='font-size:10.0pt;
font-family:Tahoma;font-weight:bold'>From:</span></font></b><font size=2
face=Tahoma><span style='font-size:10.0pt;font-family:Tahoma'> kictanet-bounces+mjoseph=safaricom.co.ke@lists.kictanet.or.ke
[mailto:kictanet-bounces+mjoseph=safaricom.co.ke@lists.kictanet.or.ke] <b><span
style='font-weight:bold'>On Behalf Of </span></b>Eric Osiakwan<br>
<b><span style='font-weight:bold'>Sent:</span></b> Sunday, October 21, 2007
12:27 AM<br>
<b><span style='font-weight:bold'>To:</span></b> Michael Joseph<br>
<b><span style='font-weight:bold'>Cc:</span></b> APC - Private list for use by
EASSY Workshop Participants; KICTAnet ICT Policy Discussions<br>
<b><span style='font-weight:bold'>Subject:</span></b> [kictanet] The tables are
turned</span></font><o:p></o:p></p>
</div>
<p class=MsoNormal><font size=3 face="Times New Roman"><span style='font-size:
12.0pt'><o:p> </o:p></span></font></p>
<p class=MsoNormal><font size=3 face="Times New Roman"><span style='font-size:
12.0pt'>Dear All,<o:p></o:p></span></font></p>
<div>
<p class=MsoNormal><font size=3 face="Times New Roman"><span style='font-size:
12.0pt'><o:p> </o:p></span></font></p>
</div>
<div>
<p class=MsoNormal><font size=3 face="Times New Roman"><span style='font-size:
12.0pt'>We are really living in interesting times especially in the ICT
industry because a few years ago, it was the mobile operators and ISPs who
would be knocking on the doors of the regulator complaining and sometimes
weeping at the anti-competitive practices of the imcumbent PTT towards them.<o:p></o:p></span></font></p>
</div>
<div>
<p class=MsoNormal><font size=3 face="Times New Roman"><span style='font-size:
12.0pt'><o:p> </o:p></span></font></p>
</div>
<div>
<p class=MsoNormal><font size=3 face="Times New Roman"><span style='font-size:
12.0pt'>Today the tables have turned and in <st1:country-region w:st="on">Kenya</st1:country-region>
as per the story below, Telkom <st1:country-region w:st="on"><st1:place w:st="on">Kenya</st1:place></st1:country-region>
is rather asking CCK to put Safaricom in check because they are acting
anti-competitively on the SMS platform against their CDMA operation. Five years
ago, this would have being an "incorrect prophesy" but it has happen
sooner than all would have expected. <o:p></o:p></span></font></p>
</div>
<div>
<p class=MsoNormal><font size=3 face="Times New Roman"><span style='font-size:
12.0pt'><o:p> </o:p></span></font></p>
</div>
<div>
<p class=MsoNormal><font size=3 face="Times New Roman"><span style='font-size:
12.0pt'>What is more interesting is the fact that Safaricom is 60% owned by
Telkom Kenya which is fully owned by government that means that the mobile
operators have become so powerful that the combined years of PTT operation and
their political forces cannot turn the tables except the mediation of the
regulator. This confirms Russell Southwood's recent story of the emergence of
the mobile operators as the new incumbents of our time. <o:p></o:p></span></font></p>
</div>
<div>
<p class=MsoNormal><font size=3 face="Times New Roman"><span style='font-size:
12.0pt'><o:p> </o:p></span></font></p>
</div>
<div>
<p class=MsoNormal><font size=3 face="Times New Roman"><span style='font-size:
12.0pt'>May be one good thing is the fact that the mobile incumbents are so
powerful that not a combiantion of PTT operation and political forces can
impact them except the court of the regulator so the political leadership in
some of our countries would now see reason to strengthen their regulators and
make them independent enough to be the pivot to balance the weight of the
mobile operators against their "cash cow" incumbents. <o:p></o:p></span></font></p>
</div>
<div>
<p class=MsoNormal><font size=3 face="Times New Roman"><span style='font-size:
12.0pt'><o:p> </o:p></span></font></p>
</div>
<div>
<p class=MsoNormal><font size=3 face="Times New Roman"><span style='font-size:
12.0pt'>Eric here<o:p></o:p></span></font></p>
</div>
<div>
<p class=MsoNormal><font size=3 face="Times New Roman"><span style='font-size:
12.0pt'><o:p> </o:p></span></font></p>
</div>
<div>
<p class=MsoNormal><font size=3 face="Times New Roman"><span style='font-size:
12.0pt'><o:p> </o:p></span></font></p>
</div>
<p style='mso-margin-top-alt:0mm;margin-right:0mm;margin-bottom:.75pt;
margin-left:0mm'><span class=apple-style-span><b><font size=2 color="#00072f"
face=Verdana><span style='font-size:10.5pt;font-family:Verdana;color:#00072F;
font-weight:bold'>Telkom Lodges SMS Petition Against Safaricom in <st1:country-region
w:st="on"><st1:place w:st="on">Kenya</st1:place></st1:country-region></span></font></b></span><o:p></o:p></p>
<p style='mso-margin-top-alt:0mm;margin-right:0mm;margin-bottom:3.75pt;
margin-left:0mm;line-height:14.25pt'><font size=3 color="#00072f" face=Verdana><span
style='font-size:12.0pt;font-family:Verdana;color:#00072F'>In the fight for
control of <st1:country-region w:st="on"><st1:place w:st="on">Kenya</st1:place></st1:country-region>'s
lucrative telecoms industry, competition is becoming a useful weapon in the
hands of rival firms -especially those that need to play the catch-up game to
remain in the race.</span></font><o:p></o:p></p>
<p style='mso-margin-top-alt:0mm;margin-right:0mm;margin-bottom:3.75pt;
margin-left:0mm;line-height:14.25pt'><font size=3 color="#00072f" face=Verdana><span
style='font-size:12.0pt;font-family:Verdana;color:#00072F'>This market share
war has become so intense that players are breaking all boundaries in the
corporate rulebook.</span></font><o:p></o:p></p>
<p style='mso-margin-top-alt:0mm;margin-right:0mm;margin-bottom:3.75pt;
margin-left:0mm;line-height:14.25pt'><font size=3 color="#00072f" face=Verdana><span
style='font-size:12.0pt;font-family:Verdana;color:#00072F'>Five months ago,
mobile phone service provider Celtel took its bigger and only rival Safaricom
before the market regulator, accusing it of playing unfairly in the market to
the disadvantage of the consumer.</span></font><o:p></o:p></p>
<p style='mso-margin-top-alt:0mm;margin-right:0mm;margin-bottom:3.75pt;
margin-left:0mm;line-height:14.25pt'><font size=3 color="#00072f" face=Verdana><span
style='font-size:12.0pt;font-family:Verdana;color:#00072F'>Now it is the
national operator Telkom's turn to lodge a landmark complaint against its
subsidiary -Safaricom.</span></font><o:p></o:p></p>
<p style='mso-margin-top-alt:0mm;margin-right:0mm;margin-bottom:3.75pt;
margin-left:0mm;line-height:14.25pt'><font size=3 color="#00072f" face=Verdana><span
style='font-size:12.0pt;font-family:Verdana;color:#00072F'>In its letter to Mr
John Waweru, the Communications Commission of Kenya director general, Telkom <st1:country-region
w:st="on"><st1:place w:st="on">Kenya</st1:place></st1:country-region> is
accusing Safaricom of practising anti-competitive behaviour in the market
-especially in the Short Messages Services (SMS) segment of the business.</span></font><o:p></o:p></p>
<p style='mso-margin-top-alt:0mm;margin-right:0mm;margin-bottom:3.75pt;
margin-left:0mm;line-height:14.25pt'><font size=3 color="#00072f" face=Verdana><span
style='font-size:12.0pt;font-family:Verdana;color:#00072F'>Telkom says
Safaricom has been blocking the exchange of SMSs between the two networks,
thereby denying its customers access to key services that the national operator
is offering such as the one that enables them to check their voter registration
details with the Electoral Commission of Kenya (ECK).</span></font><o:p></o:p></p>
<p style='mso-margin-top-alt:0mm;margin-right:0mm;margin-bottom:3.75pt;
margin-left:0mm;line-height:14.25pt'><font size=3 color="#00072f" face=Verdana><span
style='font-size:12.0pt;font-family:Verdana;color:#00072F'>"Telkom <st1:country-region
w:st="on"><st1:place w:st="on">Kenya</st1:place></st1:country-region> is
concerned that Safaricom is engaging in anti-competitive behaviour and in
essence abusing its dominant market position by introducing barriers to new
entrants targeting SMS market segment," Telkom says.</span></font><o:p></o:p></p>
<p style='mso-margin-top-alt:0mm;margin-right:0mm;margin-bottom:3.75pt;
margin-left:0mm;line-height:14.25pt'><font size=3 color="#00072f" face=Verdana><span
style='font-size:12.0pt;font-family:Verdana;color:#00072F'>Public attention was
first drawn to the matter after some Safaricom subscribers complained that
Safaricom was charging them for undelivered SMSs to Telkom <st1:country-region
w:st="on"><st1:place w:st="on">Kenya</st1:place></st1:country-region>'s
Wireless network. SMSs to Telkom network got an automatic reply indicating that
delivery had failed yet the consumers were being billed.</span></font><o:p></o:p></p>
<p style='mso-margin-top-alt:0mm;margin-right:0mm;margin-bottom:3.75pt;
margin-left:0mm;line-height:14.25pt'><font size=3 color="#00072f" face=Verdana><span
style='font-size:12.0pt;font-family:Verdana;color:#00072F'>Safaricom CEO
Michael Joseph acknowledged that some of its subscribers had sent messages to
Telkom <st1:country-region w:st="on"><st1:place w:st="on">Kenya</st1:place></st1:country-region>
during the test period and may have been charged erroneously.</span></font><o:p></o:p></p>
<p style='mso-margin-top-alt:0mm;margin-right:0mm;margin-bottom:3.75pt;
margin-left:0mm;line-height:14.25pt'><font size=3 color="#00072f" face=Verdana><span
style='font-size:12.0pt;font-family:Verdana;color:#00072F'>He said that
although the company was not billing SMSs to Telkom Wireless network between
August 13 and August 27, some of its customers may have been billed. Safaricom
later agreed to refund the affected subscribers.</span></font><o:p></o:p></p>
<p style='mso-margin-top-alt:0mm;margin-right:0mm;margin-bottom:3.75pt;
margin-left:0mm;line-height:14.25pt'><font size=3 color="#00072f" face=Verdana><span
style='font-size:12.0pt;font-family:Verdana;color:#00072F'>Telkom says that on
August 16, the two interconnectivity negotiating parties met and agreed on
interconnection rate and a technical testing schedule.</span></font><o:p></o:p></p>
<p style='mso-margin-top-alt:0mm;margin-right:0mm;margin-bottom:3.75pt;
margin-left:0mm;line-height:14.25pt'><font size=3 color="#00072f" face=Verdana><span
style='font-size:12.0pt;font-family:Verdana;color:#00072F'>During this period
the parties also exchanged SMS test templates to be adopted in the tests.
Safaricom has however not cooperated in facilitating the process, making it
unable to commercialise the service.</span></font><o:p></o:p></p>
<p style='mso-margin-top-alt:0mm;margin-right:0mm;margin-bottom:3.75pt;
margin-left:0mm;line-height:14.25pt'><font size=3 color="#00072f" face=Verdana><span
style='font-size:12.0pt;font-family:Verdana;color:#00072F'>The matter seems to
have reached fever pitch after Safaricom introduced a voter registry query
service similar to the one Telkom <st1:country-region w:st="on"><st1:place
w:st="on">Kenya</st1:place></st1:country-region> had rolled out after it won
an ECK tender.</span></font><o:p></o:p></p>
<p style='mso-margin-top-alt:0mm;margin-right:0mm;margin-bottom:3.75pt;
margin-left:0mm;line-height:14.25pt'><font size=3 color="#00072f" face=Verdana><span
style='font-size:12.0pt;font-family:Verdana;color:#00072F'>Telkom <st1:country-region
w:st="on"><st1:place w:st="on">Kenya</st1:place></st1:country-region> is
complaining that failure by Safaricom to activate the SMS service is affecting
its ability to use an innovative platform that delivers voter registry query
services by utilizing the 460 numeric to access the ECK database.</span></font><o:p></o:p></p>
<p style='mso-margin-top-alt:0mm;margin-right:0mm;margin-bottom:3.75pt;
margin-left:0mm;line-height:14.25pt'><font size=3 color="#00072f" face=Verdana><span
style='font-size:12.0pt;font-family:Verdana;color:#00072F'>Telkom <st1:country-region
w:st="on"><st1:place w:st="on">Kenya</st1:place></st1:country-region> says
Safaricom acted maliciously in delaying to activate the SMS service only to
launch a similar service.</span></font><o:p></o:p></p>
<p style='mso-margin-top-alt:0mm;margin-right:0mm;margin-bottom:3.75pt;
margin-left:0mm;line-height:14.25pt'><font size=3 color="#00072f" face=Verdana><span
style='font-size:12.0pt;font-family:Verdana;color:#00072F'>"We are
perturbed that Safaricom, having not been involved in the initial tender
process is currently able to provide a similar services using the 460 prefix.
This is a totally unacceptable anti-competitive behaviour," Telkom says.</span></font><o:p></o:p></p>
<p style='mso-margin-top-alt:0mm;margin-right:0mm;margin-bottom:3.75pt;
margin-left:0mm;line-height:14.25pt'><font size=3 color="#00072f" face=Verdana><span
style='font-size:12.0pt;font-family:Verdana;color:#00072F'>Mr Joseph declined
to comment on the matter saying it was already before an arbiter.</span></font><o:p></o:p></p>
<p style='mso-margin-top-alt:0mm;margin-right:0mm;margin-bottom:3.75pt;
margin-left:0mm;line-height:14.25pt'><span class=apple-style-span><font size=3
color="#00072f" face=Verdana><span style='font-size:12.0pt;font-family:Verdana;
color:#00072F'>Telkom <st1:country-region w:st="on"><st1:place w:st="on">Kenya</st1:place></st1:country-region>
is the majority shareholder at Safaricom with a 60 per cent stake. It co-owns
the company with the <st1:country-region w:st="on"><st1:place w:st="on">United
Kingdom</st1:place></st1:country-region>'s Vodafone Plc which has a 40 per
cent stake in the firm.</span></font></span><font color="#00072f" face=Verdana><span
style='font-family:Verdana;color:#00072F'><br>
<span class=apple-style-span>(Source: Business Daily)</span></span></font><o:p></o:p></p>
<div>
<p class=MsoNormal><font size=3 face="Times New Roman"><span style='font-size:
12.0pt'><o:p> </o:p></span></font></p>
</div>
<div>
<p class=MsoNormal><font size=3 face="Times New Roman"><span style='font-size:
12.0pt'><o:p> </o:p></span></font></p>
<div><span style='border-spacing: 0px 0px;text-align:auto;-khtml-text-decorations-in-effect: none;
-apple-text-size-adjust: auto;orphans: 2;widows: 2;word-spacing:0px'><span
style='border-spacing: 0px 0px;text-align:auto;-khtml-text-decorations-in-effect: none;
-apple-text-size-adjust: auto;orphans: 2;widows: 2;word-spacing:0px'>
<div style='margin-left:15.0pt'>
<p class=MsoNormal><font size=1 color=black face=Helvetica><span
style='font-size:9.0pt;font-family:Helvetica;color:black'><span
style='border-spacing: 0px 0px;text-align:auto;-khtml-text-decorations-in-effect: none;
-apple-text-size-adjust: auto;orphans: 2;widows: 2;word-spacing:0px'>Eric M.K
Osiakwan<o:p></o:p></span></font></p>
</div>
<div style='margin-left:15.0pt'>
<p class=MsoNormal><font size=1 color=black face=Helvetica><span
style='font-size:9.0pt;font-family:Helvetica;color:black'>Executive Secretary<o:p></o:p></span></font></p>
</div>
<div style='margin-left:15.0pt'>
<p class=MsoNormal><font size=1 color=black face=Helvetica><span
style='font-size:9.0pt;font-family:Helvetica;color:black'>AfrISPA (<a
href="http://www.afrispa.org">www.afrispa.org</a>)<o:p></o:p></span></font></p>
</div>
<div style='margin-left:15.0pt'>
<p class=MsoNormal><font size=1 color=black face=Helvetica><span
style='font-size:9.0pt;font-family:Helvetica;color:black'>Tel: + 233.21.258800
ext 2031<o:p></o:p></span></font></p>
</div>
<div style='margin-left:15.0pt'>
<p class=MsoNormal><font size=1 color=black face=Helvetica><span
style='font-size:9.0pt;font-family:Helvetica;color:black'>Fax: + 233.21.258811<o:p></o:p></span></font></p>
</div>
<div style='margin-left:15.0pt'>
<p class=MsoNormal><font size=1 color=black face=Helvetica><span
style='font-size:9.0pt;font-family:Helvetica;color:black'>Cell: +
233.244.386792<o:p></o:p></span></font></p>
</div>
<div style='margin-left:15.0pt'>
<p class=MsoNormal><font size=1 color=black face=Helvetica><span
style='font-size:9.0pt;font-family:Helvetica;color:black'>Handle: eosiakwan<o:p></o:p></span></font></p>
</div>
<div style='margin-left:15.0pt'>
<p class=MsoNormal><font size=1 color=black face=Helvetica><span
style='font-size:9.0pt;font-family:Helvetica;color:black'>Snail Mail: Pmb 208,
Accra-North<o:p></o:p></span></font></p>
</div>
<div style='margin-left:15.0pt'>
<p class=MsoNormal><font size=1 color=black face=Helvetica><span
style='font-size:9.0pt;font-family:Helvetica;color:black'>Office: BusyInternet
- <st1:Street w:st="on"><st1:address w:st="on">42 Ring Road</st1:address></st1:Street>
Central, Accra-North<o:p></o:p></span></font></p>
</div>
<div style='margin-left:15.0pt'>
<p class=MsoNormal><font size=1 color=black face=Helvetica><span
style='font-size:9.0pt;font-family:Helvetica;color:black'>Blog: <a
href="http://blogs.law.harvard.edu/eric/">http://blogs.law.harvard.edu/eric/</a><o:p></o:p></span></font></p>
</div>
<div style='margin-left:15.0pt'>
<p class=MsoNormal><font size=1 color=black face=Helvetica><span
style='font-size:9.0pt;font-family:Helvetica;color:black'>Slang: "Tomorrow
Now"<o:p></o:p></span></font></p>
</div>
<div>
<p class=MsoNormal><font size=1 color=black face=Helvetica><span
style='font-size:9.0pt;font-family:Helvetica;color:black'><o:p> </o:p></span></font></p>
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